1 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition. 16 S I X T E E N Organizational Culture C H A P T E R

2 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Van City’s Corporate Culture Vancouver City Savings Credit Union has applied a values based business model to improve customer service and employee relations and make it one of Canada’s best companies to work for. Courtesy of VanCity

3 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Organizational Culture Defined The basic pattern of shared assumptions, values, and beliefs considered to be the correct way of thinking about and acting on problems and opportunities facing the organization. Courtesy of VanCity

4 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Physical Structures Language Rituals and Ceremonies Stories and LegendsBeliefsValuesAssumptions Artifacts of Organizational Culture OrganizationalCulture Elements of Organizational Culture

5 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition RIM’s Cultural Content Research in Motion (RIM), the Waterloo, Ontario pioneer in wireless digital assistants, has a strong organizational culture. Founders Mike Lazaridis and Jim Balsillie (shown) describe the content of RIM’s culture as intense, creative, fun, inclusive, and collegial. Kitchener-Waterloo Record

6 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Meaning of Cultural Content Cultural content refers to the relative ordering of beliefs, values, and assumptions. Example: RIM values intensity whereas Q-Media values thrift. An organization emphasizes only a handful of the hundreds of cultural values. Kitchener-Waterloo Record

7 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Organizational Subcultures Located throughout the organization Can enhance or oppose (countercultures) firm’s dominant culture Two functions of countercultures: –provide surveillance and critique, ethics –source of emerging values Kitchener-Waterloo Record

8 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Artifacts: Stories and Legends Social prescriptions of desired (undesired) behaviour Provides a realistic human side to expectations Most effective stories and legends: –Describe real people –Assumed to be true –Known throughout the organization –Are prescriptive

9 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Artifacts: Rituals and Ceremonies Rituals –programmed routines –(eg., how visitors are greeted) Ceremonies –planned activities for an audience –(eg., award ceremonies)

10 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Artifacts: Organizational Language Words used to address people, describe customers, etc. Leaders use phrases and special vocabulary as cultural symbols –eg. Container Store’s “Being Gumby”  Language also found in subcultures –eg. Whirlpool’s “PowerPoint culture”

11 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Artifacts: Physical Structures and Symbols Building structure -- may shape and reflect culture –Mountain Equipment Co-op’s downtown Toronto store roof holds a 10,000 square foot garden with 4-inch thick soil Office design conveys cultural meaning –Furniture, office size, wall hangings

12 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Benefits of Strong Corporate Cultures Strong Organizational Culture Social Control Improves Sense-Making Social Glue

13 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Problems with Strong Cultures Culture content might be misaligned with the organization’s environment. Strong cultures may focus on mental models that could be limiting Strong cultures suppress dissenting values from subcultures.

14 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Adaptive Organizational Cultures External focus -- firm’s success depends on continuous change Focus on processes more than goals Strong sense of ownership Proactive --seek out opportunities AP/Wide World

15 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Bicultural Audit Part of “due diligence” in merger Minimizes risk of cultural collision by diagnosing companies before merger Three steps in bicultural audit: 1.Examine artifacts 2.Analyze data for cultural conflict/compatibility 3.Identify strategies and action plans to bridge cultures

16 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition Merging Organizational Cultures Assimilation Deculturation Acquired company embraces acquiring firm’s cultural values Acquiring firm imposes its culture on unwilling acquired firm Integration Cultures combined into a new composite culture Separation Merging companies remain separate with their own culture

17 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition StrengtheningOrganizationalCulture Founders and leaders Culturallyconsistentrewards Stableworkforce Selectionandsocialization Managing the culturalnetwork Strengthening Organizational Culture

18 Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.McShane 5th Canadian Edition. 16 S I X T E E N Organizational Culture C H A P T E R